It’s official: Microsoft’s concerned about GNU/Linux

Without fanfare (as expected), Microsoft filed its 10-K form to the Security and Exchange Commission.

In it, however, we find that Microsoft bemoans the fact that their “business model,” well, might tend to suck in comparison to the open source business model. Not only that — and maybe you should sit down for this — all that, ahem, innovation stemming from Redmond might suffer because they would have to lower their prices to keep competitive.

Let’s take a look, shall we? Some of the more tasty, entertaining morsels are:

“Our business model has been based upon customers paying a fee to license software that we developed and distributed . . . . In recent years, certain “open source” software business models have evolved into a growing challenge to our license-based software model.

[And for this we are truly thankful.]

“Open source commonly refers to software whose source code is subject to a license allowing it to be modified, combined with other software and redistributed, subject to restrictions set forth in the license . . . . A prominent example of open source software is the Linux operating system.”

[Wait for it . . ]

“Although we believe our products provide customers with significant advantages in security, productivity and total cost of ownership (emphasis added to highlight both the audacity and humor of this clause), the popularization of the open source software model continues to pose a significant challenge to our business model . . .

[When you stop laughing, I’ll continue.]

” . . .including continuing efforts by proponents of open source software to convince governments worldwide to mandate the use of open source software in their purchase and deployment of software products.

[For this we are truly thankful.]

“To the extent open source software gains increasing market acceptance, sales of our products may decline, we may have to reduce the prices we charge for our products, and revenue and operating margins may consequently decline.”

[One can only hope.]

(Larry Cafiero, editor/publisher of Open Source and Free Software Reporter, is an associate member of the Free Software Foundation.)

Microsoft often prognosticates some sort of doom-and-gloom in their 10-K filings.

Not only do they need to give their shareholders a “heads up” on any and all risks, but as long as there are competitive pressures, Microsoft can use these points to defend against any anti-competitive sentiments.

This is already happening in China where they dropped the price to $3. Growth of GNU/Linux on the desktop in hot markets is about 50% per annum so it should not be long before the whole world starts to feel the benefit of lower cost/safer computing.

Actually, corporations by law have to outline any pitfalls or risks in their 10-K to the SEC, but what seems interesting here — and I don’t know for how long Microsoft has been “reporting” the open source “risk” — is that it seems that Microsoft is feeling the heat from those making software under the open source (and free software) model.

[And angryxtian, perhaps you should crack open a history or a civics book and see what communism really means.]

Wonderful news! – I actually think that the idea of government use of linux is one thing that is truly frightening for the windows-guys… not only because it’s probably a good cash-cow as it is now, but also because the people who use linux or openoffice at work will be MUCH more likely to make the switch in their private life as well – and push for a similar push the next place they work.

Actually I think Microsoft will be completely dominant for many years to come, but people will start to realize that there IS an alternative, and this really makes a huge difference to a market that was previously more or less (less=apple/mac) monopolized by Microsoft.

Since this is my first trip to this blog which I found via a popular topic link on wordpress, I’ll chime in with this tidbit.

While I sing the praises of Free Software to all who will listen (for the record a Mac is my main box) and I use Free Software when I can, and while not much of a developer, I try to contribute with bugs as much as I as time will allow. .A lot of people seem to view Free Software as Free Beer, with no responsibility other than griping when something doesn’t work. I think it would behoove the Free Software movement to promote the fact that even if you can’t code you can contribute by writing bugs or doing documentation, etc. If said promotion does exist, I don’t see it. Then again, as I said, I sit on the edge of the FSF movement.

True, Dave: Very true about FOSS. It actually _would_ behoove FOSS to promote the fact that even if you can’t code, there are a lot of other ways to contribute. The promotion of that concept actually _does_ exist with some FOSS programs — OpenOffice.org is a good example — but so many others, especially the smaller ones, need to take up that example. Thanks for doing what you do for FOSS programs when you can.

angryxtians blog was so ridiculous – including misspelling a word like university – that it almost seemed surreal – like some clever way to make fun of Christians… I really hope it is a bad joke.
If not a bad joke, it speaks volumes about the usability of word press, that someone with such a limited mental capacity is actually able to set up and run a blog…

Hmm…. i had hoped they would remain ignorant of linux for a couple of more years… but in my view the days of paid software are over anyway. Who still wants to pay 300 euros for vista when you can get Sun Solaris Unix or Fedora Core Linux for free… just 2 name a couple.

But then again.. i always wanted to see microsoft collapse and i am hoping it will still become a reality in the future when all the brave stupid people who now still pay tons of money finally wake up and ditch windows all in one go :-)

Read up about Bill Gate’s history. the tech world was actually completely open source before he came along. he was the one that decided there should be licenses for software and that people that want to use it should pay money. thank god it’s finally coming back and biting him in the ass. the GNU license is great :)